2017 Regular Session
To: Judiciary, Division A; Accountability, Efficiency, Transparency
By: Senator(s) Horhn
AN ACT TO PROVIDE FOR THE INCORPORATION OF COOPERATIVE ASSOCIATIONS; TO PROVIDE THE POWERS AND DUTIES OF COOPERATIVES; TO PROVIDE THE REQUISITES FOR THE ARTICLES OF ASSOCIATION OF COOPERATIVES; TO PROVIDE FOR THE ADOPTION OF BYLAWS BY COOPERATIVES; TO SPECIFY THE MEMBERSHIP OF COOPERATIVES AND THE REQUISITES FOR VOTING BY MEMBERS; TO PROVIDE FOR THE ORGANIZATION OF MEETINGS AND THE NOTIFICATION OF MEMBERS OF MEETINGS; TO PROVIDE FOR THE AUTHORIZATION TO, CONTROL AND USE OF STOCK BY COOPERATIVES; TO PROVIDE FOR THE NUMBER, ELECTION AND REMOVAL OF DIRECTORS; TO PROVIDE FOR THE MEETINGS OF DIRECTORS; TO AUTHORIZE EXECUTIVE COMMITTEES; TO PROVIDE FOR THE OFFICERS OF COOPERATIVES; TO PROVIDE FOR THE COMPENSATION AND BENEFITS TO DIRECTORS, OFFICERS AND EMPLOYEES OF A COOPERATIVE; TO PROVIDE FOR THE LIABILITY OF DIRECTORS, MEMBERS, STOCKHOLDERS AND PATRONS OF COOPERATIVES; TO PROVIDE THE MANNER IN WHICH A COOPERATIVE MAY DISPOSE OF ASSETS; TO PROVIDE RULES THAT GOVERN CONTRACTS BY COOPERATIVES; TO PROVIDE THAT THE DIRECTORS SHALL DETERMINE AND DISTRIBUTE NET ASSETS AT LEAST ONCE ANNUALLY; TO PROVIDE FOR ANNUAL REPORTS; TO PROVIDE THE MANNER IN WHICH ARTICLES OF ASSOCIATION MAY BE AMENDED; TO PROVIDE THE MANNER IN WHICH COOPERATIVES MAY MERGE AND CONSOLIDATE; TO PROVIDE THE MANNER IN WHICH A COOPERATIVE MAY VOLUNTARILY DISSOLVE ITSELF; TO LIMIT THE USE OF THE TERM "COOPERATIVE" TO ASSOCIATIONS ORGANIZED UNDER THIS ACT AND TO PROVIDE PENALTIES FOR IMPROPER USE OF SUCH TERM; TO PROVIDE FOR ADMINISTRATIVE DISSOLUTION; TO AMEND SECTION 79-35-19, MISSISSIPPI CODE OF 1972, TO CONFORM; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Definitions. As used in this act:
(a) "Cooperative" means an association incorporated under this act.
(b) "Foreign cooperative" means an association incorporated under a cooperative law of another state which has members residing within this state.
(c) "Association" includes both cooperatives and foreign cooperatives.
(d) "Corporation" means all corporations not associations.
(e) "Member" means a person who has been qualified and accepted for membership in an association.
(f) "Membership stock" means any class of stock, continuous ownership of which is required for membership in a cooperative.
SECTION 2. Purposes. Cooperatives may be organized under this act for any lawful purpose except banking, insurance and building or operating public railroads, but subject to statutes relating to the organization of specified kinds of corporations.
SECTION 3. General powers. Unless otherwise provided by its articles, a cooperative may:
(a) Exist perpetually.
(b) Sue and be sued.
(c) Have a seal.
(d) Make contracts, incur liabilities and borrow money; issue certificates representing indebtedness, or representing equity interests in its assets; acquire property; dispose of, mortgage, pledge, lease or otherwise use in any manner any of its property, or any interest therein, wherever situated.
(e) Invest its funds, lend money for its purposes and hold any property as security for repayment.
(f) Conduct its business and affairs and have offices and exercise its powers in the United States or in any foreign country.
(g) Elect officers and appoint agents, define their duties and fix their compensation.
(h) Make and alter bylaws, consistent with its articles, and the laws of this state, for the administration and regulation of its affairs.
(i) Make donations for charitable, scientific, educational or religious purposes.
(j) Indemnify any present or former director, officer or agent against actual expenses necessarily incurred in defense of any proceeding in which he is a party because he is or was such director, officer or agent.
(k) Exercise all powers necessary or convenient to effect its purposes.
SECTION 4. Incorporators. Five (5) or more adults, one (1) of whom must be a resident, may form a cooperative by signing, acknowledging, filing and recording articles of association.
SECTION 5. Articles. (1) The articles of association shall set forth:
(a) The name of the cooperative.
(b) The purposes for which organized. It is sufficient to state that the cooperative may engage in any activity within the purposes for which cooperatives may be organized, and all such activities shall then be deemed within its purposes, subject to express limitations.
(c) Whether the cooperative is organized with or without capital stock.
(d) The designation of classes of members, if more than one (1).
(e) The number and par value of shares of each authorized class of stock; if more than one (1) class is authorized, the designation, preferences, limitations and relative rights of each class shall also be set forth.
(f) Which classes of stock are membership stock.
(g) As to each class of stock, the rate of dividend, or that the rate of dividend may be fixed by the board, or that no dividend will be paid. If the dividend on any class of stock is to be cumulative, this shall also be stated.
(h) Any reservation of a right to acquire or recall any stock.
(i) The basis of distribution of assets in the event of liquidation.
(j) The city, village or town in this state in which the cooperative's principal office is to be located.
(2) The articles shall be filed and recorded as provided in Section 34 of this act.
(3) The articles of association shall be conclusive evidence, except as against this state in a proceeding to cancel or revoke such certificate, that all conditions precedent to existence have been met.
SECTION 6. Organization meetings. (1) After articles have been filed, an organization meeting of the temporary board shall be held at the call of a majority of the incorporators or of a majority of the temporary directors for the adoption of bylaws, election of temporary officers, and transaction of other business.
(2) The first meeting of the members shall be called by the temporary president or a majority of the temporary directors. Such meeting shall be held as soon as reasonably possible after the organization meeting of the temporary board but not later than six (6) months after recording the articles.
SECTION 7. Bylaws. The initial bylaws of a cooperative may be adopted by the temporary board. Thereafter, bylaws may be adopted and amended only by the members, unless the members adopt a bylaw which permits the board to make and amend specified bylaws. Any bylaw adopted or amended by the board shall be reported at the next regular member meeting. Any such bylaw shall be at any time subject to amendment or repeal by the members. Unless the bylaws provide otherwise, any bylaw may be adopted, amended or repealed by a majority of the members present at a meeting.
SECTION 8. Principal office; registered agent; service of process. (1) A cooperative shall maintain in this state its principal office.
(2) The board may establish or change the location of the principal office by filing with the Mississippi Secretary of State the appropriate forms designed for this purpose by the Secretary of State.
SECTION 9. Membership. (1) A cooperative may be organized on a membership basis with or without no capital stock.
(2) A cooperative may have one or more classes of members. The designation, qualifications, requirements, method of acceptance, and incidents of membership of each class shall be set forth in the bylaws.
(3) No member may transfer his membership except as permitted in the bylaws.
(4) The bylaws may provide for termination of membership and the conditions and terms thereof.
SECTION 10. Voting. (1) Except as permitted in this section, and Section 29 or 31 of this act, no person other than a member may vote at any member meeting. A person who has not fully paid for his membership may not vote except as expressly permitted in the bylaws.
(2) At any member meeting, each member entitled to vote shall have one (1) vote.
(3) The bylaws may set forth provisions, not inconsistent with this act, relating to the methods and procedures for voting.
SECTION 11. Member meetings. (1) Unless the bylaws provide otherwise, member meetings shall be held at the principal office or such other place as the board may determine.
(2) An annual member meeting shall be held at the time fixed in or pursuant to the bylaws. In the absence of a bylaw provision, such meeting shall be held within six (6) months after the close of the fiscal year at the call of the president or board.
(3) Special member meetings may be called by the president, board, or members having one-fifth (1/5) of the votes entitled to be cast at such meeting.
(4) Written notice, stating the place, day and hour, and in case of a special member meeting, the purposes for which the meeting is called, shall be given not less than seven (7) nor more than thirty (30) days before the meeting at the direction of the person calling the meeting.
SECTION 12. Quorum. A quorum at a member meeting shall be ten percent (10%) of the first one hundred (100) members plus five percent (5%) of additional members, present in person or represented by delegate. Unless the bylaws fix a larger number of members to constitute a quorum, a quorum shall never be more than fifty (50) members nor less than five (5) members or a majority of all members, whichever is smaller. Members represented by signed vote may be counted in computing a quorum only on those questions as to which the signed vote is taken.
SECTION 13. Notice to members, stockholders or other persons; waiver. Whenever notice is required by this act to be given to any person, such notice shall be given either personally, electronically or by mail. If mailed, such notice is given when deposited in the United States mail, with postage prepaid thereon, addressed to such person at his address as it appears on the records of the cooperative.
SECTION 14. Stock; authorization, issuance, control, use and rights. (1) A cooperative organized with capital stock may issue the amount of stock stated in its articles. Such stock may be divided into two (2) or more classes with such designations, preferences, limitations, and relative rights as shall be stated in the articles, except that:
(a) Stock as such has no voting power.
(b) Stock without par value shall not be authorized or issued.
(c) The rate of dividends upon stock shall not exceed six percent (6%) of its par value for any year, but dividends may be cumulative.
(2) (a) The articles may require that members own one or more shares of membership stock. Such stock shall be issued or transferred only to a person eligible to become a member, and only when such person satisfies other requisites for membership.
(b) Unless restricted by the articles, stock other than membership stock may be issued or transferred to any person.
(3) Each certificate for stock shall bear the manual or facsimile signature of a principal officer and shall state:
(a) The name of the cooperative, the number, par value and class of the shares represented by the certificate, and whether or not it is membership stock.
(b) Any restrictions on the issuance or transfer of such stock.
(c) If more than one (1) class of stock is authorized, the designation of the several classes, and their respective preferences, limitations and relative rights.
In lieu of a full statement, this information may be given in summary form, or the certificate may state that the cooperative will, upon request, furnish the information required by this subsection.
(4) No stock certificate may be issued except upon payment of the par value of the stock it represents. Payment for stock may be in cash or other property. If in other property, the value thereof shall be determined by the board and such determination, if made in good faith, shall be conclusive.
(5) Unless the articles provide otherwise, a cooperative may acquire, recall, exchange, redeem, and reissue its own stock. Provisions in the articles and on the stock certificate may reserve to the cooperative a prior right to acquire any stock offered for sale, or a right to recall the stock of any stockholder, or both of said rights. The consideration paid for stock recalled by the cooperative shall be its par value and accrued unpaid dividends, provided that if the book value of such stock is less than the par value, the consideration shall be such book value. The cooperative may set off obligations of the stockholder to it. If the remaining assets would be less than the aggregate amount payable to creditors and persons holding stock with preferential rights upon liquidation, no stock shall be acquired, recalled, exchanged or redeemed for a consideration other than stock or certificates of equity interest of equal or subordinate rank.
(6) When stock is acquired, recalled, exchanged, or redeemed by the cooperative, such stock is restored to the status of authorized but unissued stock.
(7) Stockholders as such have no preemptive right to purchase additional stock.
SECTION 15. Directors; number, election, removal and vacancies. (1) The business and affairs of a cooperative shall be managed by a board of directors. Every director shall be a member. The bylaws shall prescribe any other qualifications for directors and may provide that directors be from specified territorial districts.
(2) The number of directors shall not be less than five (5), provided that, in a cooperative with less than fifty (50) members, the number of directors shall not be less than three (3). Subject to such limitation, the number shall be fixed in the articles, or if the articles so provide, in the bylaws.
(3) Directors shall be elected by the members at a member meeting in the manner and for the terms provided in the bylaws. Unless the bylaws provide otherwise, a director's term of office shall be one (1) year. Each director shall hold office for the term for which elected and until his successor takes office. The bylaws may permit selection of alternates to take the place of directors absent at a meeting of the board. Whenever any change is made in the board, the cooperative shall file within thirty (30) days with the Secretary of State a report showing the names and addresses of all directors.
(4) Unless the bylaws provide otherwise, a director may be removed upon a majority vote of all members.
(5) Unless the bylaws provide otherwise, any vacancy existing in the board may be filled until the next annual meeting by appointment by a majority vote of the directors then in office.
SECTION 16. Directors; meetings, quorum and waiver of notice. (1) Meetings of the board shall be held at such place and upon such notice as is prescribed in the bylaws.
(2) Unless a greater number is required in the bylaws, a majority of the directors in office shall constitute a quorum for transaction of business. Unless a greater number is required in the bylaws, an act of the majority of the directors present at a meeting at which a quorum is present shall be the act of the board.
(3) A signed waiver of notice of a board meeting is equivalent to personal notice to the person so signing. The waiver may be signed at any time. Attendance at a meeting is a waiver of notice of such meeting, except when a director attends the meeting and objects thereat to the transaction of business because the meeting was not lawfully convened.
(4) Unless the bylaws provide otherwise, the purposes of any meeting of the board need not be specified in the notice or waiver of notice of such meeting.
SECTION 17. Executive committee. (1) If the bylaws so provide, the board may elect an executive committee to consist of three (3) or more directors. When the board is not in session, such committee shall have all powers of the board except in respect to:
(a) Powers reserved by the board to itself.
(b) Apportionment or distribution of proceeds.
(c) Election of officers.
(d) Filling of vacancies in the board.
(e) Amendments to the bylaws.
(2) The board may elect other directors as alternates for members of the executive committee.
SECTION 18. Officers. (1) The principal officers of a cooperative are a president, one or more vice presidents as prescribed in the bylaws, a secretary and a treasurer. They shall be elected annually by the board at such time and in such manner as the bylaws provide. Upon original election and whenever any change is made in such officers, the cooperative shall file with the Secretary of State, within thirty (30) days, a report showing the name and address of all officers. Each principal officer except the secretary and the treasurer must be a director of the cooperative. The offices of secretary and treasurer may be combined in one (1) person.
(2) Any other officer may be chosen by the board or as provided in the bylaws.
(3) All officers shall have such authority and perform such duties as the bylaws provide, or as the board may determine not inconsistent with the bylaws. Any officer may be removed by the board whenever in its judgment the best interests of the cooperative will be served thereby.
SECTION 19. Compensation and benefits to directors, officers and employees. (1) Unless the bylaws provide otherwise, only the members may establish compensation or other benefits for a director not available generally to officers and employees, for services as a director.
(2) Unless the bylaws provide otherwise, for prior or future services of any officer or employee, the board may provide reasonable compensation, pension, bonuses or other benefits to such officer or employee, and pension or other benefits to a member of his family or his beneficiaries. No officer or employee who is a director may take part in the vote on his salary for services rendered the cooperative.
SECTION 20. Liability of directors and members. (1) Directors who negligently or in bad faith vote for any distribution of assets contrary to this act or the articles are jointly and severally liable to the cooperative for the value of assets distributed in excess of the amount which could have been distributed without violating this act or the articles.
(2) Members, stockholders and patrons of a cooperative are neither obligated to pay, nor liable upon, any cooperative obligation, except that stockholders are liable to an amount equal to the par value of their shares for debts due an employee for not more than six (6) months' service to the cooperative.
SECTION 21. Disposition of assets; right to secure debts. (1) Except as authorized by the members, the board may not dispose of all or substantially all of a cooperative's fixed assets. At any meeting the members may authorize the disposition of all or substantially all of a cooperative's fixed assets if:
(a) Notice that such disposition will be considered at such meeting has been given to all persons entitled to vote thereon; and
(b) Such disposition has been approved by two-thirds (2/3) of those entitled to vote thereon voting at the meeting.
(2) Unless the bylaws provide otherwise, the board may secure payment of a cooperative's debts by mortgaging the cooperative's rights, privileges, authority and franchises, revenues and other property.
SECTION 22. Cooperative contracts. (1) If otherwise lawful, contracts for any of the following purposes, whether written or contained in the bylaws, are valid when made between an association and any member in which such member agrees to:
(a) Sell, market or deliver all or any specified part of products produced or to be produced either by him or under his control to or through the association or any facilities furnished by it.
(b) Authorize the association or any facilities furnished by it to act for him in any manner with respect to all or any specified part of such products and any services to be furnished by him.
(c) Buy or procure all or a specified part of goods or services from or through the association or any facilities furnished by it.
(d) Authorize the association to act for him in any manner in the procurement of goods or services.
(2) The term of such contracts may not exceed five (5) years, but they may be made self-renewing for periods not exceeding five (5) years each, subject to the right of either party to terminate at the end of the original and each renewal term upon giving written notice of such termination during a period specified in such contract.
(3) Such contract may require liquidated damages to be paid by the member in the event of a breach of the contract. Liquidated damages may be either a percentage of the value of the products, goods or services, or a specific sum, but neither may be more than thirty percent (30%) of the value of the products, goods or services, subject to the breach. Where a specific sum is provided as liquidated damages, but such sum exceeds thirty percent (30%) of the value of the products, goods or services which are the subject of the breach, then the contract shall be construed as providing an amount equal to thirty percent (30%).
SECTION 23. Relief against breach or threatened breach. In the event of a breach or threatened breach of a contract authorized by Section 22 of this act by a member, the association shall be entitled to an injunction to prevent the breach or any further breach thereof.
SECTION 24. Apportionment and distribution of proceeds. At least once annually the directors shall determine and distribute net proceeds as follows:
(a) There shall be deducted from total proceeds:
(i) All operating expenses and costs.
(ii) The cost of supplies, commodities, equipment and other property or services procured or sold for patrons.
(iii) The cost of services performed for patrons.
(iv) All taxes and all other expenses.
(v) Reasonable and necessary reserves for depreciation, depletion and obsolescence of physical property, doubtful accounts and other valuation reserves, all of which shall be established in accordance with usual and customary accounting practices.
(b) The remainder of the total proceeds are net proceeds, and shall be distributed and paid as follows:
(i) An amount not to exceed five percent (5%) thereof may be set aside as an educational fund to be used in teaching or promoting cooperative organization or principles.
(ii) A share of the net proceeds may be set aside for or paid to officers or employer, or both.
(iii) In a cooperative organized with capital stock, such dividend may be paid upon capital stock as is authorized by the articles. No dividend may be paid if the capital is impaired or if payment of such dividend would result in an impairment of capital.
(c) Unless the articles or bylaws otherwise expressly provide, none of the remainder of the net proceeds shall constitute income of the cooperative but all thereof shall be distributed as follows:
(i) Reasonable reserves for necessary purposes may be created, which shall be credited to patrons in accordance with the ratio which their patronage bears to total patronage.
(ii) All the remainder of the net proceeds shall be distributed and paid to patrons in accordance with the ratio which their patronage bears to total patronage.
(iii) There shall be no distinction between the persons entitled thereto, but such reserves and distributions may be based upon business done with particular departments or in particular commodities, supplies or services, or upon classification of business according to the type or nature thereof.
(d) If the articles or bylaws so provide:
(i) Any of the net proceeds may be credited to allocated or unallocated surplus or reserves of the cooperative.
(ii) None of the remainder shall constitute income to the cooperative, but all thereof shall be distributed and paid in accordance with the ratio which individual patronage bears to total patronage, either to member patrons only or to all patrons with nonmembers receiving a lower proportion than members, as the bylaws may provide. There shall be no other distinction between members and nonmembers, but distribution may be based on business done with particular departments, or in particular commodities, supplies or services, or upon classification of business according to type or nature thereof.
(e) The distribution and payment of net proceeds under paragraph (c) or (d) of this section may be in cash, credits, stock, certificates of interest, revolving fund certificates, letters of advice, or other certificates or securities of the cooperative or of other associations or corporations, in other property, or in any combination thereof.
(f) All or any part of the net proceeds may be applied to losses incurred in prior years, and the bylaws may also include any reasonable provisions for the apportionment of losses.
SECTION 25. Books and records; penalty for refusal to produce. (1) A cooperative shall keep correct and complete books and records of account, and shall also keep minutes of the proceedings of meetings of its members, board and executive committee. The cooperative shall keep at its principal office records of the names and addresses of all members and stockholders with the amount of stock held by each, and of ownership of equity interests. At any reasonable time, any member or stockholder, or his agent or attorney, upon written notice stating the purposes thereof, delivered or sent to the cooperative at least one (1) week in advance, may examine for a proper purpose any books or records pertinent to the purpose specified in such notice.
(2) In any proceedings, or upon petition for such purpose, any court of record may, upon notice and after hearing at which proper cause is shown, and upon suitable terms, order any of the cooperative's books or records, and any other pertinent documents in its possession, or duly authenticated copies thereof, to be brought within this state. Such documents shall be kept at such place and for such time and purposes as the order designates. Any cooperative failing to comply with the order is subject to dissolution, and its directors and officers are liable for contempt of court.
SECTION 26. Annual reports; filing thereof. (1) A cooperative shall file an annual report signed by a principal officer or the general manager setting forth:
(a) Its name and complete address.
(b) The names and addresses of its directors and principal officers and registered agent as required by Section 79-35-5.
(c) A statement, by class and par value, of the amount of stock which it has authority to issue, and the amount issued.
(d) A statement as to the general type of business engaged in during the prior year.
(2) The annual report shall be made on forms furnished by the Secretary of State, and the information therein contained shall be given as of the date of the execution of the report.
(3) The annual report shall be delivered to the Secretary of State between January 1 and April 15 of each year following incorporation. If the report does not conform to requirements, it shall be returned to the cooperative for necessary corrections. The penalties for failure to file such report shall not apply if it is corrected and returned within thirty (30) days after receipt thereof.
(4) If the report is not filed before the following January 1, the cooperative is not in good standing and shall be placed in dissolved status automatically. Until restored to good standing, the Secretary of State may not accept for filing any document respecting such cooperative except those incident to its dissolution.
(5) The cooperative may be restored to good standing by delivering to the Secretary of State a current annual report and by paying the Twenty Dollar ($20.00) reinstatement fee plus Twenty-five Dollars ($25.00) for each calendar year or part thereof during which it was not in good standing.
SECTION 27. Omission of seal. Whenever any document is required to be sealed, no seal is required if the document includes a statement to the effect that the cooperative has no seal.
SECTION 28. Amendments to articles. (1) At any member meeting a cooperative may adopt any amendment to its articles which is lawful under Section 5 of this act, if a statement of the nature of the amendment was contained in the notice of the meeting.
(2) Unless stockholders are entitled by Section 29 of this act to vote on an amendment, an amendment is adopted when approved by members holding two-thirds (2/3) of the member votes cast thereon.
SECTION 29. Stockholder voting on amendments to articles. (1) Whether or not permitted to vote by the articles, a holder of stock other than membership stock who is affected by a proposed amendment to articles shall be entitled to cast one (1) vote on such amendment regardless of the dollar amount of stock he holds, or the number of affected classes of stock held by him, provided that the articles may permit such affected stockholder to cast one (1) vote for each share of stock he holds. A member holding stock affected by a proposed amendment may vote both as a member and as an affected stockholder.
(2) For purposes of this section, a holder of stock is affected as to any class of stock owned by him, only if an amendment would expressly:
(a) Decrease the dividends to which that class may be entitled or change the method by which the dividend rate on that class is fixed.
(b) Restrict rights to transfer that class.
(c) Give to another existing or any new class of stock or equity interest not previously entitled thereto, any preference as to dividends or upon dissolution which is the same or higher than preferences of that class.
(d) Change the par value of shares of that class or of any other class having the same or higher preferences as to dividends or upon dissolution.
(e) Increase the number of authorized shares of any class having a higher preference as to dividends or upon dissolution.
(f) Require or permit an exchange of shares of any class with lower preferences as to dividends or upon dissolution for shares of that class or any other class with the same or higher preferences.
(3) If stockholders are entitled to vote on an amendment, such amendment is adopted if:
(a) Notice of the meeting, a copy of the proposed amendment and a mail ballot thereon has been sent to each member and each affected stockholder;
(b) Members holding two-thirds (2/3) of the member votes cast thereon approve; and
(c) Two-thirds (2/3) of the affected stockholders voting thereon approve. If stockholders are permitted by the articles to cast one (1) vote for each share of stock they hold, the amendment shall be adopted by the holders of at least two-thirds (2/3) of the shares of each class entitled to vote thereon voting at the meeting.
(4) This section shall not apply to stock issued prior to July 1, 2015, unless the cooperative adopts an amendment to its articles making such stock subject to this section.
SECTION 30. Filing and recording amendments; effect thereof. (1) Amendments to articles shall be signed by the president or a vice president and the secretary or an assistant secretary, and shall set forth:
(a) The name of the cooperative.
(b) The amendment and date of adoption.
(c) The number of members.
(d) The number of members voting for and against such amendment.
(e) If affected stockholders have the right to vote under Section 29 of this act, the number of affected stockholders voting for and against such amendment. If affected stockholders voted on a share basis, then the shares of each class voting for and against the amendment.
(2) The amendment shall be filed and recorded as provided in Section 34 of this act.
(3) No amendment may affect any existing cause of action or proceeding to which the cooperative is a party or existing rights of persons other than members or stockholders.
(4) No action may be maintained to invalidate any amendment because of the manner of its adoption unless commenced within two (2) years after the date of recording.
SECTION 31. Merger and consolidation. If otherwise lawful, any two (2) or more associations may merge or consolidate under this act or under the law of the state where the surviving or new association will exist. Before a cooperative may merge or consolidate with any other association, a written plan of merger or consolidation shall be prepared by the board or by a committee selected by the board or the members for that purpose. Such plan shall set forth all the terms of the merger or consolidation and the proposed effect thereof on all members and stockholders of the cooperative. In case of consolidation the plan shall also contain the articles of the new association. The members and such stockholders as are entitled to vote thereon shall approve the plan in the manner provided in Section 29 of this act for amendments to the articles.
SECTION 32. Voluntary dissolution. (1) At any member meeting, whether or not a quorum is present, a cooperative may dissolve if:
(a) Notice that a resolution for dissolution will be considered and acted upon has been given to all members and to all other persons entitled by the articles to vote thereon; and
(b) Such resolution is adopted by members holding three-fourths (3/4) of the member votes cast thereon. The articles may permit stockholders to vote on the resolution for dissolution.
(2) When the resolution is adopted, either a committee designated by the resolution or the board shall liquidate all assets and pay the net proceeds of such liquidation available for distribution to all persons entitled to the same by law, the articles and the bylaws.
(3) Articles of dissolution shall be signed by a majority of directors or of committee members and shall be sealed with the cooperative's seal. They shall set forth:
(a) The name of the cooperative.
(b) The name and address of each director or committee member.
(c) The date of adoption of the resolution of dissolution.
(d) A statement that all liquidation activities have been completed.
(4) The articles of dissolution shall be filed and recorded as provided in Section 34 of this act, and thereupon the existence of the cooperative ceases.
SECTION 33. Fees for filing. (1) The Secretary of State shall collect from any cooperative for filing:
(a) Articles of association for a new
(b) An amendment to the articles or articles of merger, consolidation, or division............................... $25.00
(c) Articles or decree of dissolution......... $25.00
(d) Receiving services of any process, notice
or demand................................................ $15.00
(e) Filing an annual report of a cooperative.. $25.00
(f) Answering a request for verification of
corporate existence or status and issuing a
certificate to the effect................................ $25.00
(g) For any other document required to be
filed under this chapter or revisions thereto............ $25.00
(2) No document may be filed or recorded until all fees therefor have been paid.
SECTION 34. Fees or penalty due state. Any fee or penalty due under this act may be recovered in a suit brought by the Secretary of State or the Attorney General in the name of the state.
SECTION 35. Forms to be furnished by Secretary of State. The Secretary of State may provide forms for any document to be filed in his office under this act. All filings, electronic or in paper, shall be made utilizing forms issued by the Secretary of State when possible. The Secretary of State shall have the exclusive right to designate the method or means by which these forms may be filed and to promulgate rules therefore.
SECTION 36. Use of term "cooperative"; penalty for improper use. (1) The term "cooperative," or any variation thereof, may be used either by an association or by a credit union organized under this act or other acts or legislation as passed, or may be passed, in this state.
(2) No other person may use the term "cooperative" or any variation thereof as part of his corporate or other business name or title, nor may any other person in any other manner represent himself to be a cooperative. Whoever violates this subsection may be fined not more than One Hundred Dollars ($100.00). Each day of improper use constitutes a separate offense.
(3) Any cooperative may obtain an injunction against acts prohibited by subsection (2) of this section without showing any damage to itself.
(4) Every cooperative shall use the term "cooperative" or an abbreviation thereof as part of its corporate name or affixed thereto.
SECTION 37. The Secretary of State may commence a proceeding to administratively dissolve a cooperative if:
(a) The cooperative does not pay within sixty (60) days after they are due any franchise taxes or penalties imposed by Section 79-4-1.01 et seq. or other law;
(b) The cooperative does not deliver its annual report to the Secretary of State within sixty (60) days after it is due;
(c) The cooperative is without a registered agent in this state for sixty (60) days or more;
(d) The cooperative does not notify the Secretary of State within sixty (60) days that its registered agent has been changed, or that its registered agent has resigned;
(e) The cooperative's period of duration stated in its articles of incorporation expires; or
(f) An incorporator, director, officer or agent of the cooperative signed a document he knew was false in any material respect with intent that the document be delivered to the Secretary of State for filing.
SECTION 38. Section 79-35-19, Mississippi Code of 1972, is amended as follows:
79-35-19. In addition to other penalties, a person commits an offense if the person makes a false statement in a registered agent filing that names a person the registered agent of a represented entity without the person's written consent. The following penalties and liabilities shall apply with respect to a false statement in a registered agent filing made under this chapter that names a person the registered agent of a represented entity without the person's consent:
(1) Section 79-4-1.29 (Domestic Corporations); Section 79-4-15.30 (Foreign Corporations); Section 79-11-123 (Domestic Nonprofit Corporations); Section 79-11-385 (Foreign Nonprofit Corporations); Section 79-29-207 (Domestic Limited Liability Companies); Section 79-29-1019 (Foreign Limited Liability Companies); Section 79-13-1003 (Limited Liability Partnerships); Section 79-13-1106 (Foreign Limited Liability Partnerships); Section 79-15-129 (Foreign Investment Trusts); and Section 79-16-27 (Foreign Business Trusts); and Section 36 of this act (Cooperative Associations).
(2) The Secretary of
State may commence a proceeding to administratively dissolve the domestic
entity or to revoke the foreign entity's certificate of authority or similar
certificate as prescribed by Section 79-4-14.20 (Corporations); Section 79-4-15.30
(Foreign Corporations); Section 79-11-347 (Nonprofit Corporations); Section 79-11-385
(Foreign Nonprofit Corporations); Section 79-13-1003 (Limited Liability
Partnerships); Section 79-13-1106 (Foreign Limited Liability Partnerships);
Section 79-29-809 (Limited Liability Companies); Section 79-29-1011 (Foreign
Limited Liability Companies); Section 79-14-811 (Limited Partnerships); Section
79-14-1010 (Foreign Limited Partnerships); Section 79-15-129 (Foreign
Investment Trusts); * * *
Section 79-16-27 (Foreign Business Trusts); and Section 36 of
this act (Cooperative Associations). Any entity that is administratively
dissolved or whose certificate of authority is revoked pursuant to this
paragraph shall not be reinstated unless it complies with the applicable
statutory reinstatement requirements and unless it provides to the Secretary of
State with its application for reinstatement a statement of appointment of
registered agent signed by its appointed registered agent and an additional
reinstatement fee of Two Hundred Fifty Dollars ($250.00), in addition to the applicable
statutory reinstatement fee.
SECTION 39. This act shall take effect and be in force from and after July 1, 2017.